COPENHAGEN: The Shanghai Shipping Exchange (SSE) has released new figures that show the spot rates on the significant Asia-Europe trade, which includes the Middle East, took yet another dive this week, this time US $58 to US $284 per teu.
According to the analyst agency Clarksons Platou, this puts the rate uncomfortably close to the actual cost of bunker of USD 260 per teu and below the average Bunker Adjustment Factor (BAF) of about USD 360 per teu.
As such, Clarksons Platou is predicting a major selloff of tonnage in the near future for major shipping companies that need to fill their new ships to take advantage of their economies of scale and get rid of older less efficient tonnage that cannot compete in a market of hairline profit margins.
“If the current rates continue, which is unlikely, we forecast that Maersk’s continuous rates will be down by 14% year-on-year or about double of the carrier’s reduction in unit costs,” writes Clarksons Platou. “We expect that rationality will win and that the lines will adjust supply and demand,” the firm adds.
